AI Insights
M/s. Sherowali Trade & Transport challenged the legality of the seizure of goods by customs authorities, alleging that the seizure was unauthorized and the goods were not contraband. The customs officials, acting on specific intelligence, seized the goods believing they were intended for illegal export to Bangladesh. The court examined the legal authority of the customs officers, the basis of their reasonable belief for the seizure, and the participation of the petitioner in the subsequent proceedings. The court concluded that the seizure was lawful, supported by adequate reasons and materials, and dismissed the petition.
Appeal Details
Counselvise Citation
[2013] 140 COUNSELVISE.COM (IT) 800167 (HC-TRIPURA)
Assessee PAN
Bench
Appeal Number
CRN Number
Appellant
Respondent
Appeal Type
Others
Pronouncement Date
09-04-2013
Assessment Year
misc
Judgement Text
" W.P(Crl.) No. 03 of 2012 Page 1 of 40 1 IN THE HIGH COURT OF TRIPURA AGARTALA W.P(Crl.) No. 03 of 2012 Petitioner : M/s. Sherowali Trade & Transport having its registered office at J.B. Road, near colonel Chowmuhani, P.S – West Agartala, district – West Tripura, Represented by its Authorised person Shri Arunabha Chakraborty, S/o. Lt. Mantu Chakraborty, resident of Abhoynagr, P.S. East Agartala, Dist. West Tripura. By Advocates: Mr. B.N. Majumder, Adv. Mr. Rajib Saha, Adv. Respondents : 1. The Union of India, Represented by the Secretary, Revenue, Govt. of India, New Delhi. 2. The Commissioner of Customs, Customs House, M.G. Road, Shilling, P.O. Shillong, Meghalaya. 3. The Assistant Commissioner of Customs, Customs Division, Agartala, P.O. Agartala, Dist. West Tripura. 4. The Superintendent, DPF, Customs Preventive Division, P.O. Agartala, Dist. West Tripura. By Advocate : Mr. P. Datta, standing counsel Custom and Central Excise, Tripura. B E F O R E THE HON’BLE MR. JUSTICE S. TALAPATRA Date of hearing : 20.12.2012. Date of Judgment : 09.04.2013 J U D G M E N T AND O R D E R The petitioner has challenged the legality of the proceeding being Customs House Case No. 33/CL/EXP/DPF/AAGT/12 dated 17.11.2012, W.P(Crl.) No. 03 of 2012 Page 2 of 40 2 Annexure P-3 to the writ petition and sought for a direction for releasing the seized goods to the petitioner. THE ESSENTIAL FACT AS UNFOLDED BY THE PETITIONER AS THE FOUNDATION OF THE CHALLENGE [2] The petitioner, M/s. Sherowali Trade & Transport, a registered transporter under the Value Added Tax Act and the Rules framed thereunder has been carrying on the business of transporting the taxable and non-taxable goods from outside the State and vice versa. The petitioner uses the uniform consignment notes wherein in clause-6 of the condition of carriage it is provided: “….. the consignor shall truly and correctly declare his goods and take every precaution to comply with customs, excise and other Government rules and regulations in force time to time. The company shall not be liable if any goods are declared to be prohibited and contravened detained or confiscated or otherwise dealt with by the Government on any ground due to any other reason whatsoever.” [3] On declaring the goods in Form-XXV in compliance with the statutory requirement along with the relevant invoices and the transporter’s manifest to the Officer-in-Charge Churaibari Check Post a truck vehicle bearing No. WB29-6271 had entered into the State of Tripura and reached Agartala on 17.11.2012. Copies of the manifest, Form-XXV and invoices of the consignors are annexed as Annexure P-2 series with the writ petition. On 17.11.2012 when the said vehicle reached in front of the office and the godown of the petitioner, the respondent No. 4, the Superintendent, DPF, Customs Preventive Division with a contingent of the BSF personnel had taken control of the vehicle along with goods, the driver and the assistant. When the respondent No. 4 was requested to divulge the reason for the said W.P(Crl.) No. 03 of 2012 Page 3 of 40 3 action he did not divulge anything. After some time the driver and the assistant of the vehicle were taken in the custody and they were in the custody till 19.11.2012. According to the petitioner, the seizure list was prepared by the respondent No. 4 on 22.11.2012 wherein it has been recorded that the truck vehicle was seized by preparing the seizure list on 17.11.2012 in witness of the driver and the assistant of the said vehicle. In the said seizure list dated 17.11.2012 (Annexure P-3 to the writ petition) the ground of seizure as disclosed is an under: “..the goods ( Specified under the Customs Act, 1962) were likely to be illegally exported to Bangladesh through the route other than prescribed under Section 7(c) of the customs Act, 1962 and in violation of Section 11 read with Notification No. 31/2008-CUS(NT) dt. 25.03.2008 and Notification No. 35/2008-CUS (NT) dt. 02.04.2008 & in violation of the provisions of Foreign Trade (Development & Regulation) Act, 1992”. [4] From the reasons for the seizure it can be availed, according to the petitioner that the seizure was effected basically on the ground that in the seized goods there were some cough syrups which were ‘specified’ goods and were likely to be illegally exported to Bangladesh through a route other than the prescribed in the Customs Act, 1962. [5] The petitioner further contends that the consignment No. KR 1558 against the invoices No. 0069 and 0061 dated 28.10.2012 was transported from Kolkata for the consignee M/s. Universal Drug House and the invoice disclosed 5400 bottles of Recodex Syrup, transported along with other vitamin syrups. But for the reason, best known to the respondents, they had shown that a quantity of 9000 bottles as seized. It appears from the seizure list that 6,000 bottles of Phensedyl (new) cough, lintus were found in W.P(Crl.) No. 03 of 2012 Page 4 of 40 4 15 packages of old and used cloths, which were for the consignee, Krishna Textiles, Mohanpur and the consignment was sent by Abishek Textiles, Kolkata vide C.N. No. 1555 x 5, 1553 x 3, 1556 x 5. The petitioner has further submitted that the transporter has no authority to check any package given by the consignor for transportation and they are to remain satisfied with the invoice and the name and address of the consignee and as such, the petitioner had no knowledge that those 6000 bottles of phensedyl cough syrup were packed inside 15 master packagtes of old and used cloth. [6] The petitioner has contended that if the seizure list is to be believed, then it has to be held that the consignor of the goods, marked as 1555 x 5, 1553 x 3, 1556 x 5, had made a false declaration to the petitioner at the time of consigning the goods and for which the petitioner has no liability. The petitioner has further asserted that non-compliance of Section 110(1-b) of the Act has surfaced brazenly contents of the C.N has show otherwise and in the course suspicion arose about the correctness of the seizure list and in view of that, the seizure has to be held illegal. For reference the provision of 110 (1-B) of the Customs Act, 1962 is reproduced hereunder: “110 (1-B) – Where any goods, being goods specified under sub-section (1-A), have been seized by a proper officer under Sub-section (1), he shall prepare an inventory of such goods containing such details relating to their description, quality, quantity , mark, numbers, country of origin and other particulars as the proper officer may consider relevant to the identity of the goods in any proceeding under t his Act and shall make an application to a Magistrate for the purpose of— (a) certifying the correctness of the inventory so prepared; or (b) taking, in the presence of the Magistrate, photographs of such goods, and certifying such photographs as true; or W.P(Crl.) No. 03 of 2012 Page 5 of 40 5 (c) allowing to draw representative samples of such goods, in the presence of the Magistrate, and certifying the correctness of any list of samples so drawn.” The petitioner also annexed the consignment notes as Annexure P-4. The petitioner has further submitted that the customs officer can seize the goods which are found to be ‘not permitted under the law’, but cannot seize other goods which are apparently not specified goods. As such, it is stated that by all means the other consignments could not have detained and seized by the customs officer concerned. [7] The cough syrup linctus containing codeine phosphate is a drug within the meaning of Drug and Customs Act, 1940 and Rules, 1945 it can be prescribed as Schedule ‘H’ medicine which cannot be sold by a person who has no valid drug licence and the person having the drug licence can sell only on prescription of the registered medical practitioners. The said consignment No. KR1558 was brought within the State of Tripura by the consignee after furnishing proper documents to the petitioner, namely, his drug licence, the sale invoice etc. and as such the petitioner has stated that there is no reason for seizure of the truck along with other goods. The petitioner has also produced the letter issued by the Deputy Drugs Controller-in-Charge, Govt. of Tripura as Annexure P-5. [8] The petitioner has further submitted that the medicines containing Codeine Phosphate are openly available in the market. The Customs authorities are not taking any action against those retailers and the distributors, but on the ground that the said drug is specified drug and the same was found within 50 km from the Indo-Bangladesh border. The truck W.P(Crl.) No. 03 of 2012 Page 6 of 40 6 with goods were seized. Geographically no part of Tripura falls beyond 50 km of Bangladesh border and if the petitioner’s truck and other goods were seized solely on the ground of bringing the consignment No. KR 1558 within 50 km of Indo-Bangaladesh border. In that case, all medicine shops at Agartala should also be liable to seizure and confiscation. The power of the Customs authority for seizure of any goods is derived from Section 110 of the Customs Act, 1962. A bare perusal of the provisions of law according to the petitioner goes to show that there is a pre-condition for affecting such seizure. The Customs authority has to bring on record the reason to believe that any goods are likely to be confiscated under the Act. In this present case no such reason has been assigned according to the petitioner. [9] The petitioner further submitted that on going through the inventory the seizure list, it is amply clear that all the goods as seized were medicines as mentioned. The reasons assigned the inventory list has divulged further that all the other consignments were also meant for illegal export to the Bangladesh. The notifications dated 25.03.2008 and 02.04.2008 as relied by the respondents while effecting the seizure has no relevance.The petitioner has contended that the sub-section 18 of Section 2 of the Customs Act, 1962 defines export: “with its grammatical variations and cognate expressions, means taking out of India to a place outside India.” [10] In this case, the vehicle loaded with those seized materials when reached in front of the godown of the petitioner, the said seizure was caused. Even a common person having ordinary prudence would not believe that those were meant for ‘illegal export to Bangladesh’ as stated. In the W.P(Crl.) No. 03 of 2012 Page 7 of 40 7 seizure list dated 17.11.2012 the reasons that the goods were likely to be illegally exported to Bangladesh” cannot be sustained as those are not supported by any materials. [11] The legislature according to the petitioner has consciously legislated and incorporated sub-section 1(b) to Section 110 of the Customs Act, 1962, wherein it has been mandated that the seizing officer has to report the seizure to the nearest Magistrate to certify the correctness of the inventory seizure list so prepared by the seizing officer. In this case, such compliance is not there by the respondent No. 4. Therefore, according to the petitioner, the entire seizure has been caused in violation of provision in Section 110(1-b) of the Act. As no authorized officer of the Custom Department had reasons to believe that those materials were liable to be confiscated under the provisions of the Customs Act, 1962, the petitioner is saddled with the liability to deliver the consignments to the consignees and as such the petitioner has approached this Court by filing this petition. The petitioner has also submitted that in terms of Section 100A those seized, materials can also released provisionally by the Commissioner of Customs on receipt of security. RESPONSE BY THE RESPONDENTS AGAINST THE ALLEGATION OF ARBITRARINESS AND ILLEGAL ACTION: [12] The respondents by filing the common counter affidavit stated that on 17.11.2012 at about 0700 hours, acting on a specific information received by the DC (G) SHQ, BSF, Gokulnagar, Tripura regarding import of a big consignment of Codeine based cough formulations viz. Phensedyl Cough Linctus (New)/Recodex Cough Syrup to Agartala illegally for exporting to W.P(Crl.) No. 03 of 2012 Page 8 of 40 8 Bangladesh, for which the Inspector(G) for Deputy Commandant(G) SHQ, BSF GNR issued a forwarding letter to the Supdt., DPF, Customs Division, Agartala to detail the customs team with the BSF for immediate operation. In terms of the above, the customs official formed a team for operation and rushed to the spot with the BSF staff, as per their secret information (which has been produced before the Court) under a sealed cover, in front of the godown of the petitioner. The officers of Anti-Smuggling, Narcotics and Intelligence unit (DPF), Agartala headed by the Superintendent(A/S), Customs Division, Agartala in association with the BSF Officers and staff of the Gokulnagar Sector Office, Gokulnagar, Tripura(w), jointly detected the loaded truck bearing registration No. WB-29-6271 parked at the place as per the secret information. The said custom officer on belief that the truck loaded with goods was for illegal export to Bangladesh. The secret seal cover along with forwarding letter bearing No. G/SHQ(GNR)/244/SMGG/12/1280 dated 17.11.2012 has been kept in a confidential file by the Superintendent, DPF Customs, Agartala Division. At that time the driver and the khalasi (the assistant) were also found present in the loaded truck. On demand by the Customs Officers, the driver as well as the khalasi could not produce any licit document in support of the said goods in the truck. Then the officers formed a belief that the goods loaded inside the truck were for smuggling. For thorough checking of the truck, the custom officer brought the truck along with the driver and the khalasi at the Customs Divisional Office, M.B. Road, Agartala for intensive checking of the goods as carried by the said truck as it was not possible on their part to check the goods on the main road called J. N. Bari Road, Agartala, Tripura (W). The said truck was ready for journey to the destination with the goods from that place. From the said truck the goods W.P(Crl.) No. 03 of 2012 Page 9 of 40 9 were unloaded and rummaged at the customs Divisional office premises in presence of the driver and the khalasi of the said truck and independent witnesses as well. As a result of the rummaging, the customs officers recovered 9000 bottles of Recodex Cough Syrup (100 ml each)[ packed in 30 master packages placed in 3 paper cartons containing 100 bottles each (30 x 3 x 100)] and 6000 bottles of Phensedyl cough linctus (new) (100 ml each)[in 15 master packages packed with old and used cloth, markin cloth & finally with hessian cloth containing 8 paper carton of 50 bottles of each, marked as ‘To Krishna Textiles, Mohanpur from Abhishek Textile, Kolkata, and the said Recodex and Phensedyl were loaded at the bottom of the said truck. The officer also recovered miscellaneous goods loaded with the consignment of Recodex cough syrup and Phensedyl cough linctus used for concealing goods, mixed with the other goods in such manner that the smuggle goods could not be separated from such other goods. Again on being asked by the Customs Officer the driver and the Khalasi of the said truck failed to produce any licit documents in respect of the carrying/purchase of the recovered codeine based cough syrup and other goods. [13] In terms of the specific information about carriage of the codeine based cough syrup viz. Recodex Cough Syrup and Phensedyl Cough Linctus, ‘specified goods’ vide CBEC’s Notification No. 35 of 2008 Customs (NT) dated 02.04.2008, brought to Tripura for illegal export to Bangladesh and further the place of detection being well within 50 km from the Indo- Bangaladesh border which is the specific area as per notification No. 31/08 Customs (NT) dated 25.03.2008, the Customs Officer effected seizure of (i) 9000 bottles of Recodez Cough Syrup (100 ml each) valued at Rs. 6,48,000/-, W.P(Crl.) No. 03 of 2012 Page 10 of 40 10 (ii) 6000 bottles of Phensedyl Cough Linctus (new) (100 ml each) valued at Rs. 4.80,000/- (iii) Misc. goods used for concealment of Recodes Cough Syrup and Phensedyl Cough Linctus valued at Rs. 8,26,124/- which were, according to the Custom Officer liable for confiscation under Section 110 and Section 119 of the Customs Act. 1962, (iv) One old and used Tata LPT Truck bearing Registration No. WB-29-6271-01 no. valued at Rs. 6,00,000/-, exclusively used for transportation of the said ‘specified goods’ was also liable for confiscation under Section 115 of the Customs Act, 1962. The Custom Officer effected the seizure of the said codeine based cough syrups along with the misc. goods and the truck vide case No. 33/CL/EXP/DPF/AGT/2012 dated 17.11.2012 under Section 110 of the Customs Act, 1962 on 17.11.2012 at about 1800 hours at Customs Divisional Office, Agartala after observing all necessary formalities. The respondent further contended that an inventory was drawn in presence of the Superintendent, DPF, Customs Division, Agartala, the driver, the Khalasi and independent witnesses. The BSF authority also issued a letter to the Superintendent, DPF Unit regarding the detection and participation of the action at the time of seizure of smuggle goods as per their intelligence along with brief details. [14] The respondents also stated that on 17.11.2012, 18.11.2012 & 19.11.2012 Md. Fariad, the driver of the seized truck No. WB-29-6271 was examined by the Superintendent of Customs and his voluntary statement and the statement in question and answer form was receivd. Moin Khan, the Khalashi of the said truck made voluntary statement and the statement in question and answer form on 17.11.2012 and 18.11.2012 was duly recorded. Both the driver and the khalashi as stated could not give satisfactory W.P(Crl.) No. 03 of 2012 Page 11 of 40 11 explanation regarding the goods, Phensedyl and Recodex as carried by the said truck having concealed by the other goods. The voluntary statements of the driver and the khalashi have also been placed with the counter affidavit. They further submitted that on 19.11.2012 on the strength of a Search Warrant No. 24 of 2012 dated 19.11.2012 the premises of M/s. Universal Drug Centre, Ronaldsay Road, Agartala and the house premises of Satya Ranjan Saha, the proprietor of M/s. Universal Drug Centre were raided and searched, but neither any contraband goods nor any incriminating documents could be recovered from these premises. However, Satya Ranjan Saha was out of station as stated by his son. On 19.11.2012 the driver of the said vehicle stated categorically that the said truck were loaded under the supervision of an employee of Sherowali Transport at their godown of Barabazar, Kolkata, but could not reveal the name of the said employee. But he categorically stated that he did not know an employee of Sherowali Transport namely Tamal Sengupta. [15] For demonstrating that the action that was resorted to by the respondents was legitimate they stated in their counter affidavit that in view of the Notification No. 31/2008-Customs (N.T), dated 25.03.2008 and Notification No. 35/2008-Customs (N.T) the 02.04.2008 as issued by the of Ministry of Finance, Govt. of India, the Phensedyl cough linctus(new) and Recodex cough syrup (codeine based cough syrups) have no demand for its medical use at all in the market of Tripura as no druggist/chemist in the State purchase or sell the said medicines officially nor do the medical practitioner prescribe the same to patients in the State of Tripura and also there is no such stockiest/distributors of the said codeine based cough syrups in the W.P(Crl.) No. 03 of 2012 Page 12 of 40 12 State of Tripura, but there is heavy demand of such medicines in the neighboring country, Bangladesh. At the same time considering the multitude of seizure effected by Customs, the Police and other agencies in the State of Tripura, the plausible reason as to why Phensedyl cough linctus (new) and Recodex cough syrup are being transported /stored in such huge quantities to Agartala can only be attributed for illegal export to Bangladesh through a route other than specified under Section 7(1)(c) Customs Act, 1962 in violation of Section 11J and 11K of the Customs Act, 1962 and other allied Acts and Rules in force and those specified goods are liable for confiscation under Section 113(b) & (d) of the Customs Act, 1962. According to the respondents, the seizure of Phensedyl cough Linctus (new) & Recodex cough syrup [specified goods under the CA’62] is effected under Section 110 of Customs Act, 1962. The other miscellaneous goods were used premeditatedly as means of concealment of the said contraband goods, phensedyl cough linctus (new) and Recodex cough syrup. Therefore, the miscellaneous goods (mentioned in the inventory) as seized were also liable for confiscation under provision of Section 119 of the Customs Act, 1962. [16] The Truck bearing registration No. WB-29-6271 was also exclusively used to carry the Phensedyl cough Linctus (new) and Recodex cough syrup (codeine based) meant for illegal export to Bangladesh and thus the truck was liable for confiscation under the provision of Section 115(2) of the Customs Act, 1962. Accordingly a specific case has been launched against the petitioner and others. The respondents further pointed out that certain serious manipulations in the invoices, such as in the invoice dated 28.10.2012 issued by M/s. Vikalp Pharma, Jeevandan Complex, Aminagad, W.P(Crl.) No. 03 of 2012 Page 13 of 40 13 Lucknow in the name of M/s. Universal Drug Centre, Joynagar Bus Stand, Battala, Agartala, Tripura(w), placed at page-52 of the writ petition has been carried out. The discrepancy as located is catalogued by the respondents in the tabular form in the counter affidavit is reproduced hereunder: As per W. P. As per Inventory of the seized goods. (a) Quantity 5400 bottles 9000 bottles [100 ml] (b) Batch Nos. WBI 1206 WBI 1213 & WBI 1215 (c) Date of Expiry 01/14 06/14 [17] From the consignment details placed at Page-20 of the writ petition filed by the petitioner, it appears that at Sl. No. 5 of C/N No. KR-1588 dated 31.10.2012, the consignor is ‘V.P. and whereas from the Invoice No. 0060 and 0061 dated 28.10.2012 it appears the consignee is M/s. Universal Drug Centre having Regn. No. 16060375276 but till date no copy of such invoice was submitted to the respondents either by the driver of the seized truck or by the said transport company. The invoices submitted along with writ petition placed at page 52 do not have any Sl. No. at all. Thus, it has been inferred that the invoice mentioned in the C/N as ‘EUD 006 & 007’ are not the same & irrelevant. Moreover at page No. 51 the Consignment note No. KR 1558 dated 31.10.2012 the invoice numbers appear to be 0060 and 0061 dated 28.10.2012. Further the number of Packages mentioned in the said consignment details as 34, but in fact the total quantity of the seized Recodex cough syrup-9000 bottles were packed in 30 master packages each containing 3 paper cartons containing 100 bottles each (30 x 3 x 100). All these documents as stated appeared to the respondents as forged and manipulated documents. They stated in their counter affidavit that the petitioner was also found involved in the similar activities in the past and they W.P(Crl.) No. 03 of 2012 Page 14 of 40 14 have referred the seizure of huge quantity of codeine based cough syrups from the godown of the petitioner at Agartala. [18] During investigation, the Deputy Drugs Controller, Agartala intimated the respondents vide office letter No. F. 13(8) DCA/97/SUB I/1694 dt. 12.07.2012 that “It was observed from the records produced by the Sherowali Trade & Transport that the firm dealt with such drugs containing Codeine Phosphate at the end of 2011 & beginning of 2012. The Inspecting Officer (Drugs) are investigating the matter to institute prosecution against the firm and also other accused persons.” The said letter is made part of the counter affidavit as Annexure-D. The said Drug Controller has also apprised the respondents by his letter dated 12.07.2012 that there is no authorized stockiest of Phensedyl cough syrup in Tripura. It has also been contended that the petitioner had produced some purchase records of those drugs as a proof of dealing with the drugs by M/s. Universal Drug Centre. [19] Without much illustration, the respondents have stated that the petitioner is “the habitual offender and involving with the smuggled goods” and they have produced inventory of the previous seizure dated 01.04.2012 with the counter affidavit. The respondents have also unfolded that they have already issued summons dated 27.11.2012 to the proprietor of the M/s. Universal Drugs Centre, and in response to the summons, nobody appeared before the customs authority to claim the goods. The respondents has further stated that in respect of the goods so seized where no notice is given under Section 124 Clause (a) within six months of the seizure of the goods, the W.P(Crl.) No. 03 of 2012 Page 15 of 40 15 goods shall be returned to the persons from whose possession they were seized. The proper officer may also seize any documents or things which in his opinion “will be useful or relevant to” any proceeding under the Act. [20] The respondents have contended that the consignment notes as submitted along with the writ petition at page 20, 51 and 52 clearly prove that on the basis of the false declaration the petitioner carried the said goods without verifying the valid invoice with an ulterior motive and for that purpose they used motor vehicle bearing No. WB-29-6271. Accordingly, the vehicle was liable to be confiscated under Section 115 of the Customs Act, 1962. Huge number of the codeine based cough syrup as stated were recovered from the said truck without any valid documents and carried by using misc. goods used for concealments of contraband drugs and for that reason the misc. goods were seized under Section 119 of the Customs Act, 1962. It appeared that the respondents that there was nexus between these materials to the belief as required. The goods were also liable to confiscation in the light of the Section 110 read with Section 123. The Customs Officer formed an opinion as to the reasonable belief as per secret information as received from the BSF authority and seized the goods from truck bearing No. WB-29-6271 under Section 110 read with Section 115,119 and 123 of the Custom Act, 1962 on search. As such, the petition is not maintainable as the alleged infraction is entirely baseless and it has to be dismissed without any further consideration, the respondents asserted. [21] The respondents also stated that on 27.11.2012 summons has been issued to Nilanjan Datta, proprietor of Sherowali Trade and Transport to appear before the Customs authority in connection with the said seizure W.P(Crl.) No. 03 of 2012 Page 16 of 40 16 dated 17.11.2012, which has been questioned by filing this writ petition, but without appearing, said Nilanjan Datta submitted a prayer seeking time on the ground that his uncle died on 25.11.2012. [22] During investigation it has been also revealed that the “Krishna Textile” is exclusively dealing with the cloths and they are not dealing with the codeine based cough syrup. Finally the respondents contended that the entire consignment was carried without valid document or doubtful documents. [23] For purpose of appreciating the Section 115, 119 and 123 of the Custom Act, as reference has been made to those provisions abundantly those are reproduced hereunder: “115. Confiscation of conveyance.—(1) The following conveyances shall be liable to confiscation:- (a) any vessel which is or has been within the Indian customs water, any aircraft which is or has been in India, or any vehicle which is or has been in any manner for the purpose of concealing goods; (b) any conveyance from which the w hole or any part of the goods is thrown overboard, staved or destroyed so as to prevent seizure by an officer of customs; (c) any conveyance which having been required to stop or land under section 106 failed to do so, except for the good and sufficient cause; (d) any conveyance from which any warehoused goods cleared for exportation, or any other goods cleared for exportation under a claim for drawback, are unloaded, without the permission of the proper officer; (e) any conveyance carry imported goods which has entered India and is afterwards found with the whole or substantial portion of such goods missing, unless the master of the vessel or aircraft is able to account for the loss of , or deficiency in, the goods. W.P(Crl.) No. 03 of 2012 Page 17 of 40 17 (2) Any conveyance or animal used as a means of transport in the smuggling of any goods or in the carriage of any smuggled goods shall be liable to confiscation, unless that owner of the conveyance or animal proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any, and the person in charge of the conveyance or animal : Provided that where any such conveyance is used for the carriage of goods or passengers for hire, the owner of any conveyance shall be given an option to p ay in lieu of the confiscation of the conveyance a fine not exceeding the market price of the goods which are sought to be smuggled or the smuggled goods, as the case may be. Explanation.- In this section, “market price” means price at the date when the goods are seized. 119. Confiscation of goods used for concealing smuggled goods.- Any goods used for concealing smuggled goods shall also be liable to confiscation. Explanation.- In this Section, “goods” does not include a conveyance used as a means of transport. 123. Burden of proof in certain cases.- (1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be— (a) in a case where such seizure is made from the possession of any person,-- (i) on the person from whose possession the goods were seized; and (ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person; (b) in any other case, on the person, if any , w ho claims to be the owner of the goods so seized. (2) This section shall apply to gold [and manufactures thereof] watches, and any other class or goods which the Central Government may by notification in the official Gazette, specify. “ IN THE FOCUS OF THE CHALLENGE W.P(Crl.) No. 03 of 2012 Page 18 of 40 18 [24] As it appears from the allegations and the response thereto that the following substantial grounds have been substantially projected by the petitioner: (i) Whether the seizing authority, the respondent No. 4 has got any authority, or is he competent and authorized by law to cause such search and seizure? (ii) Whether the seized materials namely codeine based cough syrup are contraband goods and the misc. seized materials were used for concealing them? (iii) Whether the action of the respondents No. 4 is liable to be interfered with by this Court or not.?” [25] Mr. B.N. Majumder, learned counsel appearing for the petitioner vehemently argued that the seizure is entirely unauthorized and illegal in as much as there is no reason for believing that the goods as carried by the vehicle under reference were liable to be confiscated. Moreover, before conducting the search, reason for belief has to be recorded. Mr. B.N. Majumder, learned counsel appearing for the petitioner contended that so far the question regarding “reason to belief” is concerned it is open to the Court to consider whether the reasons exited or not and the test would be whether a reasonable, prudent person on the basis of the materials relied upon would hold the same belief. The so called belief of the officials was at the most suspicion, far away from belief which could be said to be reasonable and hence the condition precedent for the exercise of power under Section 110 of the Act was absent in the case in hand. In the case of Sri Sai Trading Company & Anr. Vrs. The Union of India & ors, in Civil Writ W.P(Crl.) No. 03 of 2012 Page 19 of 40 19 jurisdiction Case No. 12197 of 2011 the Patna High Court while dilating upon the provisions of Section 108 of the Customs Act, 1962 held that: “12. In this connection reference may be made to a decision of the Apex Court in case of Indian Nut Products and others vs. Union of India and others, reported in (1994) 4 Supreme Court Cases 269 in which it was held that if a statute requires an authority to exercise power, when such authority is satisfied that conditions exist for exercise of that power, the satisfaction has to be based on the existence of grounds mentioned in the statute. The grounds must be made out on the basis of the relevant material. If the existence of the conditions required for the exercise of the power is challenged, the courts are entitled to examine whether those conditions existed when the order was made. A person aggrieved by such action can question the satisfaction by showing that it was wholly based on irrelevant grounds and hence amounted to no satisfaction at all. In other words, the existence of the circumstances in question is open to judicial review. 13. So far the question regarding \"reasons to believe\" is concerned, a Division Bench of this court in case of Angou Golmei Vs. The Union of India and Others (1994 (1) PLJR 800) specifically held that the reason for formation of the belief having been spelt out, it is open to the court to consider whether the reasons exist or not and the test would be whether a reasonable, prudent person on the basis of materials relied upon would hold the same belief. The so-called belief of the officials was at the most mere suspicion, far away from belief which could be said to be reasonable and hence the condition precedent for the exercise of power under section 110 of the Act was absent and the seizure on the basis of such belief cannot be said to be in accordance with law. 14. In this connection reference may also be made to a decision of a Bench of Bombay High Court in case of M.G. Abrol vs. Amichand Vallamji, reported in A.I.R. 1961 Bombay 227 in which it has been held as follows:- \"The Customs Officers should seize the goods covered by S. 178A in a reasonable belief that they are smuggled goods before the burden of proving that they are not smuggled goods could be on the person from whose possession such goods were seized. This position would be very much clear if it can be contrasted with a case where Customs Officer seizes any of such goods merely on suspicion that they are smuggled. A suspicion can arise from peculiar kind of movement on the part of the person who is supposed to be in possession of some smuggled goods. It may arise from the kind of dealing that the person W.P(Crl.) No. 03 of 2012 Page 20 of 40 20 might be having in regard to certain goods, which the Customs Officer might thereupon subject to be smuggled. One may conceive of a number of other ways in which a suspicion may arise in the mind of the Customs Officer that any particular person is possessed of smuggled goods. A belief, on the other hand, cannot arise merely in the circumstances in which a suspicion can arise. A belief in the existence of a thing requires a more solid foundation than in the case of a mere suspicion. It may be based upon some definite information acquired from a reliable source that a certain person is in possession of smuggled goods. The belief again, as required by S. 178A of the Sea Customs Act, must be a reasonable one, not a belief of a man who just catches at some slight circumstances which only creates a sort of guess or speculation in his mind that something might exist or might not exist. The belief must be such as any other reasonable man in the circumstances of the case would entertain about the existence or non-existence of a thing.\" 15. From the aforesaid well settled principles of law, it is quite apparent that so far the point of time at which reasonable belief should exist is concerned, whenever the goods are seized, the officer seizing the goods must at the time of seizure have a reasonable belief that the goods he was seizing were smuggled goods and any subsequent acquisition of knowledge of such belief would be of no avail. So far the allegation that betel nuts in question were of foreign origin is concerned, a Division Bench of this court in case of Commissioner, Custom Department, Government of India, Patna (supra) had specifically held that it was not in dispute that betel nut was non-notified item and, as such, the onus to prove that the same was of foreign origin lay on Custom authority.” [26] Mr. B.N. Majumder, learned counsel also relied on a decision of the Apex Court in Indian Nut products and Others Vrs. Union of India and others, reported in (1994) 4 SCC 269 where the Apex Court held that: “10. It is well-settled that if a statute requires an authority to exercise power, when such authority is satisfied that conditions exist for exercise of that power, the satisfaction has to be based on the existence of grounds mentioned in the statute. The grounds must be made out on the basis of the relevant material. If the existence of the conditions required for the exercise of the power is challenged, W.P(Crl.) No. 03 of 2012 Page 21 of 40 21 the courts are entitled to examine whether those conditions existed when the order was made. A person aggrieved by such action can question the satisfaction by showing that it was wholly based on irrelevant grounds and hence amounted to no satisfaction at all. In other words, the existence of the circumstances in question is open to judicial review.” [27] In Whirlpool Corporation Vrs. Registrar of Trade Marks, Mumbai and Others, reported in (1998) 8 SCC 1 the Apex Court while considering the jurisdiction of the High Court under Article 226 when an alternative remedy is available to the aggrieved person and that aggrieved person without exhausting the said remedy had approached the High Court whether the High Court can exercise the powers thereof, held that: “14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution This power can be exercised by the High Court not only for issuing writs in the nature of Habeas Corpus, Mandamus, prohibition, Qua Warranto and Certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution but also for \"any other purpose\". 15. Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this court not to operate as a bar in at least three contingencies, namely, where the Writ Petition has been filed for the enforcement of any of the Fundamental rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case law on this point but to cut down this circle of forensic whirlpool we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field. 16. Rashid Ahmad v. Municipal Board, kairana, AIR 1950 SC 163 , laid down that existence of an adequate legal remedy was a factor to be taken into consideration in the matter of granting Writs. This was followed by another Rashid case, namely, K.S. Rashid & Son v. The Income Tax Investigation W.P(Crl.) No. 03 of 2012 Page 22 of 40 22 Commissioner, AIR 1954 SC 207 which reiterated the above proposition and held that where alternative remedy existed, it would be a sound exercise of discretion to refuse to interfere in a petition under Article 226. This proposition was, however, qualified by the significant words, \"unless there are good grounds therefor\", which indicated that alternative remedy would not operate as an absolute bar and that Writ Petition under Article 226 could still be entertained in exceptional circumstances. 17. Specific and clear rule was laid down in State of U.P. v. Mohd. Nooh, AIR 1958 SC 86 as under : \"But this rule requiring the exhaustion of statutory remedies before the Writ will be granted is a rule of policy convenience and discretion rather than a rule of law and instances are numerous where a writ of certiorari has been issued in spite of the fact that the aggrieved party had other adequate legal remedies.\" 18. This proposition was considered by a Constitution Bench of this Court in A. V. Venkateswaran, Collector of Customs. Bombay v. Ramchand Sobhraj Wadhwani and Anr. AIR 1961 SC 1506 and was affirmed and followed in the following words: \"The passages in the judgments of this Court we have extracted would indicate (1) that the two exceptions which the learned solicitor General formulated to the normal rule as to the effect of the existence of an adequate alternative remedy were by no means exhaustive and (2) that even beyond them a discretion vested in the High Court to have entertained the petition and granted the petitioner relief notwithstanding the existence of an alternative remedy. We need only add that the broad lines of the general principles on which the Court should act having been clearly laid down, their application to the facts of each particular case must necessarily be dependent on a variety of individual facts which must govern the proper exercise of the discretion of the Court, and that in a matter which is thus pre-eminently one of discretion, it is not possible or even if it were, it would not be desirable to lay down inflexible rules which should be applied with rigidity in every case which comes up before the Court\". 19. Another Constitution Bench decision in Calcutta Discount co. Ltd. v. Income Tax Officer Companies Distt, 1: AIR 1961 SC 372 laid down : \"Though the writ of prohibition or certiorari will not issue against an executive authority, W.P(Crl.) No. 03 of 2012 Page 23 of 40 23 the High Courts have power to issue in a fit case an order prohibiting an executive authority from acting without jurisdiction. Where such action of an executive authority acting without jurisdiction subjects or is likely to subject a person to lengthy proceedings and unnecessary harassment, the High Court will issue appropriate orders or directions to prevent such consequences. Writ of certiorari and prohibition can issue against Income Tax Officer acting without jurisdiction Under Section 34 I.T. Act\". 20. Much water has since flown beneath the bridge, but there has been no corrosive effect on these decisions which though old, continue to hold the field with the result that law as to the jurisdiction of the High Court in entertaining a Writ Petition under Article 226 of the Constitution, in spite of the alternative statutory remedies, is not affected, specially in a case where the authority against whom the Writ is filed is shown to have had no jurisdiction or had purported to usurp jurisdiction without any legal foundation.\" [28] Mr. Nandi Majumder, learned counsel, also pressed a decision of the Apex Court in Union of India Vrs. Abdul Mohamed, reported in (2000) 10 SCC 169 to buttress his contention as regards the definition and meaning of “acquire” appearing in Section 4(1). In Abdul Mohamed(supra) the Apex Court held that: “4. The precondition to attract Section 4(1) would be “buy or otherwise acquiring or burrowing from or sell or otherwise transfer or lend to or exchange with any person not being an authorized dealer, any foreign exchange”. From the fact that some foreign exchange was recovered from the car belonging to the respondent, the only provision which may possibly get attracted is whether the respondent can be said to have “otherwise acquired”, inasmuch as all other expressions in sub-section (1) of Section 4 are totally absent. The expression “acquire” must have a definite connotation and it must indicate something more than mere possession. There is an iota of material to indicate even that the respondent knew what the packet contained when it was delivered to him or when the packet was recovered from the car being intercepted. He has taken a plea that it was handed over to him at Bombay to be carried to Kasaragod and somebody would come to take it from him at Kasaragod. Such a plea, on the face of it, cannot be rejected ipso facto.” W.P(Crl.) No. 03 of 2012 Page 24 of 40 24 [29] Having reference to this exposition, Mr. Nandi Majumder, learned counsel, submitted that the role of a transporter is to act on the manifest containing the list of the goods and not beyond that. Apart that, the seizure is absolutely illegal in view of the fact that the Codeine based syrups which were seized from the vehicle were never declared contraband by any law. Mr. Nandi Majumder, learned counsel, while contending that the seizure has been caused by an Officer who was not the Proper Officer and as such the seizure is bound to be held illegal and per contra the law. The Seizing Officer was never designated as the Proper Officer by the appropriate authority. Having referred the following passages from Commissioner of Customs Vrs. Sayed Ali & Anr., reported in 2011 AIR SCW 1517 he has contended that only such a Custom Officer who has been assigned the specific function or duty in the jurisdictional area would be the Proper Officer in terms of the Section 2(34) of the Customs Act, 1962 not otherwise. Unless the seizure is caused by a Proper Officer, the seizure is bound to be held illegal. The Apex Court held that: “10. Per contra, Mr. Joseph Vellapally, learned senior counsel appearing on behalf of the Respondents in C.A. Nos. 4294-4295 of 2002, contended that the statutory powers conferred under Section 28 of the Act must be exercised by an officer of Customs, who has been assigned those functions either by the Central Board of Excise and Customs or by the jurisdictional Commissioner of Customs (Imports). As the Commissioner (Preventive) has not been appointed as a \"proper officer\" for the purposes of assessment or re-assessment, nor assigned any functions under Section 28 of the Act or under any other Section related to assessment of goods entered for home consumption, he was not competent to issue notice under Section 28 of the Act, argued the learned Counsel. It was also urged that mere appointment of a person as an officer of Customs with territorial jurisdiction over the Mumbai port under Section 4 of the Act, does not ipso facto confer authority on him to exercise the statutory powers entrusted to proper officers, as under the Act, while all proper officers must be `officers of Customs', all `officers of Customs' are not \"proper officers\". In W.P(Crl.) No. 03 of 2012 Page 25 of 40 25 support of the proposition, learned Counsel heavily relied on a decision of the Karnataka High Court in Devilog Systems India v. Collector of Customs, Bangalore : 1995 (76) E.L.T. 520 (Kar.) and orders of the Tribunal in Orient Arts and Crafts v. Commissioner of Customs (Prev.), Mumbai: 2003 (155) E.L.T .168 (Tri-Mum) and Informatika Software (P) Ltd. and Anr. v. Commissioner of Customs (P), Calcutta 1997 (73) ECR 348 (Tri.-Kolkata). Learned Counsel submitted that the use of the expression \"proper officer\" in contradistinction to \"officer of customs\" in certain Sections in the Act makes it clear that the two expressions cannot be used interchangeably. Learned Counsel contended that if the Revenue's contention that all \"officers of customs\" are \"proper officers\" is accepted, it would render Section 2(34) otiose, and would amount to re- writing the Act, leading to administrative anarchy. In support, reliance was placed on the decision of this Court in The Commissioner, Sales Tax, U.P. v. Suraj Prasad Gouri Shankar : (1974) 3 SCC 230. ***** ***** ****** ****** ****** ****** ** 14. From a conjoint reading of Sections 2(34) and 28 of the Act, it is manifest that only such a customs officer who has been assigned the specific functions of assessment and re-assessment of duty in the jurisdictional area where the import concerned has been affected, by either the Board or the Commissioner of Customs, in terms of Section 2(34)of the Act is competent to issue notice under Section 28 of the Act. Any other reading of Section 28 would render the provisions of Section 2(34) of the Act otiose in as much as the test contemplated under Section 2(34) of the Act is that of specific conferment of such functions. Moreover, if the Revenue's contention that once territorial jurisdiction is conferred, the Collector of Customs (Preventive) becomes a \"proper officer\" in terms of Section 28 of the Act is accepted, it would lead to a situation of utter chaos and confusion, in as much as all officers of customs, in a particular area be it under the Collectorate of Customs (Imports) or the Preventive Collectorate, would be \"proper officers\". In our view therefore, it is only the officers of customs, who are assigned the functions of assessment, which of course, would include re- assessment, working under the jurisdictional Collectorate within whose jurisdiction the bills of entry or baggage declarations had been filed and the consignments had been cleared for home consumption, will have the jurisdiction to issue notice under Section 28 of the Act.” [30] In additional there to Mr. Nandi Majiumder, learned counsel appearing for the petitioner has contended that Gauhati High Court in Zenith W.P(Crl.) No. 03 of 2012 Page 26 of 40 26 Drugs & Allied Agencies (P0 Ltd. Vrs. Union of India & Ors., reported in 2008 (1) GLT 588 held that: 13. ***** there was no evidence on record explicitly and candidly manifest before the Custom Authority to prove that the Phensedyl in question stored in the godown of the concerned transporter was ever meant for smuggling to Bangladesh. To bring home this sole submission, the learned Counsel for the petitioner has relied upon a decision of a Division Bench of Orissa High Court reported in 1989(39)ELT183(Ori) (Ramkrishna Aggarwal v. Collector of Central Excise & Customs, Orissa) wherein paragraph-7 it was held that onus was on the Department to prove that the specified goods were intended to be transported into a specified area and thus there was violation of the statutory provisions of Sections 11K and 113A of the Customs Act and accordingly, observed that the distinction needed to be drawn between 'preparation' and 'attempt'. Preparation for committing an offence was always different from attempt to commit it. The preparation consisted in devising or arranging the means or measures necessary for the commission of offence. On the other hand an attempt to commit the offence was a direct movement towards the commission after preparations were made. In order that a person might be convicted of an offence to commit a crime, he must be shown first to have had an intention to commit the offence and secondly, to have done an act which constituted the \"actus reus\" of a criminal attempt. [31] Mr. Nandi Majumder, learned counsel for the petitioner having referred a decision of the Apex Court in Jaipur Development Authority Vrs. Ram Sahai & Anr., reported in 2006 AIR SCW 5963 has contended that in terms of the provisions, ‘illegal export’ means the export of any goods in contravention of the provisions of the Act or any other law for the time being in force and the persons who owns, possesses or controls on the specified date, any specified goods, the market price of which exceeds fifteen thousand rupees and every persons who acquires(within the specified area), after the specified date and no specified goods in terms of Section 11K of the Customs Act, 1962 shall be transported from , into or within any specified W.P(Crl.) No. 03 of 2012 Page 27 of 40 27 area or loaded on any animal or conveyance in such area, unless they are accompanied by a transport voucher (in such form and containing such particulars as may be specified by rules made in this behalf) prepared by the person owning, possessing, controlling or selling such goods, provided that no transport voucher shall be necessary for the transport, within a village, town or city of any specified goods that market price of which, on the date of transport, does not exceed one thousand rupees. He had further contended that since the seized materials were never a prohibited contraband goods for purpose of illegal export, the entire seizure was untenable in law and according to Mr. Nandi Majumder, learned counsel for the petitioner there was grave infraction to Section 110(1B) of the Customs Act, 1962 in as much as no application was made to the Magistrate for the purpose of surveying the correctness of the inventory so prepared. [32] While refuting the submissions of Mr. B. N. Majumder, learned counsel, Mr. P. Datta, learned standing counsel Customs and Central Excise has submitted that there is no requirement of applying to the Magistrate in terms of Section 110(1B) of the Act unless those goods are perishable or hazardous in nature as the said provision categorically provides that where goods specified and covered under Section 1A of the Section 110 of the Customs Act, 1962 are concerned such procedure has to be followed. Sub Section 1A of Section 110 of the Customs Act, 1962 provides, for the goods perishable or hazardous in nature not other goods. Thus the contention of Mr. B.N. Mazumder, learned counsel for the petitioner according to Mr. P. Datta does not hold any substance. Mr. Datta, learned standing counsel has also submitted that the Adjudication Order dated 31.03.2011 in respect of the W.P(Crl.) No. 03 of 2012 Page 28 of 40 28 Seizure Case No. 13/CL/EXP/CUS/HQRS.PREV/SH/09-10 dated 10.02.2010 has been furnished to all the persons concerned. The said order out come of the proceeding under Section 108 of the Customs Act, 1962, is elaborate enough. The relevant part of the order is quoted hereunder for reference: “24.1 I order confiscation of the 60,000 bottles (100 ml. each) of Recodex Cough Syrup, valued at Rs.37,80,000/- (Rupees Thirty seven lakh and eighty thousand)only seized vide case no. 13/CL/EXP/CUS/HQRS.PREV/SH/09-10 dated 10.02.2010 under Section 113 (b) & (d) of the Customs Act 1962 for reasons as discussed above. I however allow M/s Universal Drug Centre, Ronaldsay Road, Battala, Agartala to redeem the said medicines, as provided under Section 125 of the Customs Act 1962, upon payment of a fine of Rs.8,00,000/- (Rupees Eight lakh)only. The option for redeeming the goods is to be exercised within 30 (thirty) days of receipt of this order, failing which the confiscation of goods will be deemed to be absolute considering expiry date. 24.2 I hold the miscellaneous trade goods as detailed at para 1.4 (B) above (as reflected in Sl. No. 2 to 13 of Annexure-B of the inventory of the seizure case 13/CL/EXP/CUS/HQRS.PREV/SH/09-10 dated 10.02.2010) valued at Rs.7,53,729/- (Rupees Seven lakh fifty three thousand seven hundred and twenty nine)only, released provisionally upon execution of a bond for full seizure value and bank guarantee to Shri Nilanjan Dutta, proprietor of M/s Sherowali Trade & Transport, 57, J.N. Bari Road, Agartala, Tripura (W), liable to confiscation under Section 119 of the Customs Act 1962 for reasons as discussed above and accordingly impose a fine of Rs.1,00,000/- (Rupees One lakh) only in lieu of confiscation of the same in terms of Section 125 of the Customs Act 1962 on Shri Nilanjan Dutta. The fine so imposed is to be adjusted from the aforementioned bank guarantee and the bond may be released accordingly. 24.3 I refrain from confiscating truck bearing registration number JK-05-B-1082 under Section 115(2) of the Customs Act 1962 for reasons as discussed above. 24.4 I impose a penalty of Rs.1,00,000/- (Rupees One lakh) only on Shri Satya Ranjan Saha, proprietor of M/s Universal Drug Centre, Ronaldsay Road, Battala, Agartala-799001 under Section 114 of the Customs Act 1962 for reasons as discussed above. 24.5 I also impose a penalty of Rs.50,000/- (Rupees Fifty thousand) only on Shri Nilanjan Dutta, proprietor of M/s Sherowali Trade & Transport, 57, J.N. Bari Road, Agartala, Tripura (W) under Section W.P(Crl.) No. 03 of 2012 Page 29 of 40 29 114 of the Customs Act 1962 for reasons as discussed above. 24.6 I further impose a penalty of Rs.20,000/- (Rupees Twenty thousand) only on Shri Tamal Sengupta, In-charge of M/s Sherowali Trade & Transport, 6, Ramlochan Mallick Street, Kolkata-73 under Section 114 under Section 114 of the Customs Act 1962 for reasons as discussed above. 24.7 I refrain from imposing any penalty in terms of Section 114 of the Customs Act 1962 on (i) Smt. Arati Paul of M/s Rajmahal, Dhaleswar Road, Agartala, (ii) Shri Biplab Kumar Saha of M/s Progressive Service Centre, LN Bari Road, Ganaraj Chowmuhani, Agartala, (iii) Shri Amulya Ch. Debnath of M/s Samhunath & Co., 152/1, Motor Stand Road, Agartala, (iv) Shri Amal Chakraborty, of M/s Jharna Medical Distributors, 36, M.B. Road, Amulya Market, Agartala, (v) Shri Pranab Bhowmik of M/s Bhowmik Enterprises, Joynagar Middle Road, Agartala, (vi) Shri Amiya Bhattacharjee of M/s Tripura Agro Services & Chemicals, H.G.B. Road, Agartala, (vii) Shri Nitai Saha of M/s N.G. Footwear, H.G. Basak Road, Agartala, (viii) Shri Nitai Basak of 72/2 Central Road, Agartala, (ix) Shri Sudhan Ch. Kar of M/s Kar Enterprise, 23, Central Road, Amiya Sagarpur, Agartala, (x) Shri Ramdas Paul of M/s Kalimata Traders, Central Raod, Agartala, (xi) Shri Subhas Ch. Sharma of M/s GDS Automobile, M.S. Road, Agartala, (xii) Shri Vinayak Nayak of M/s SNC Power Corporation (P) Ltd., Palatana, Amar Sagar, Udaipur, (xiii) M/s Ramkrishna Medical Agency of D.K. Road, Dharmanagar, (xiv) M/s Rohit Medicine Company of 7, Indira Market, Gurudwara Road, Modinagar, Ghaziabad, (xv) Shri Mukul Chandra Das, Rajyasharpur, Lala, Hailakandi, Assam, (xvi) Shri Kashif Ashraf, R/o Fatehpora, Khawjabagh, baramulla, Jammu & Kashmir, (xvii) Shri Diptanil Datta of M/s Sherowali Trade & Transport, 57, J.N. Bari Road, Agartala, (xviii) Shri Bikash Dhar of M/s Sherowali Trade & Transport, 57, J.N. Bari Road, Agartala, (xix) Shri Sujoy Saha of M/s Universal Drug Centre, Ronaldsay Road, Battala, Agartala and (xx) Shri Satish Jaitha of M/s VIP Distributors (P) Ltd., 5, Kustia Road, Kolkata for reasons as discussed above.” [33] Mr. Datta, learned standing counsel, further submits that the said order is appealable under Section 128 of the Customs Act, 1962. Moreover, the said order has also not been challenged. He has further referred Order No. 01/2009 issued by the Commissioner of Customs (Preventive) North Eastern Region, Shillong on 06.04.2009 whereunder for W.P(Crl.) No. 03 of 2012 Page 30 of 40 30 Sections 100, 101, 104, 106, 107, 110 and along with other sections the Inspector of Customs has been designated as the Proper Officer to discharge all such duties in terms of the said sections. He submitted that for such designation the officer who conducted the search in exercise of the power granted under Section 102 was competent to make such search. He also seriously criticized the contention of Mr. B.N. Majumder, learned counsel for the petitioner that there had been violation of Section 102(4) of the Customs Act, 1962 and he submitted that the driver and the khalase (the assistant) were the most suitable witnesses for such search and in their presence, the search was carried out and therefore, there had been no irregularity in conducting the search. Apart that he by producing another notification dated 03.08.1974 has contended that in terms of Section 6 of the Customs Act, 1962 all Subedars and Sub-Inspectors can discharge the function under Sections 100 to 104 (both inclusive), 106, 107, 109 and 110 of the Customs Act. He on referring to a notification dated 25.03.2008 (Annexure-8 to the counter affidavit) has stated that in exercise of powers conferred by Clause (c) of Section 11H of the Customs Act, 1962, the Central Government having regard to the vulnerability to smuggling of the area mentioned in the Schedule hereto specifies the said area as specified area for the purposes of the Customs Act, 1962. For reference the scheduled area is extracted hereunder: “The inland area, fifty kilometers in width, from India’s land border with Bangladesh falling with the territories of West Bengal, Tripura, Assam, Meghalaya and Mizoram.” [34] Mr. Datta, learned standing counsel has contended that the place of seizure is admittedly within the fifty kilometer from the border of the W.P(Crl.) No. 03 of 2012 Page 31 of 40 31 Bengladesh and therefore, the seizure as carried out by the competent officers cannot be held beyond the jurisdiction. Apart that what has been contended by Mr. Nandi Majumder, learned counsel that the drugs formulations containing codeine or its salts is not a contraband can hardly be accepted in view of the notification dated 02.04.2008 (Annexure-G to the counter affidavit) where it has been provided that in exercise of the powers conferred by Section 11-I of the Customs Act, 1962 (52 of 1962) the Central Government specifies the goods in the said Schedule as the goods in respect of which special measures for the purpose of checking their illegal export and facilitating the detection of the said goods which are likely to be illegally exported, shall be taken in the areas specified along the India’s border with Bangladesh falling within the territories of West Bengal, Tripura, Assam, Meghalaya and Mizoram in terms of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 31/2008 Customs (N.T) dated 25th March, 2008. For purpose of reference the schedule as referred to the said notification dated 02.04.2008 is extracted hereunder: “Drug formulations containing Codeine or its salts.” [35] Mr. P. Datta, learned standing counsel for the Customs and Central Excise on referring to the summons(Annexure-N to the counter affidavit) issued to the petitioner submitted that on receipt of the summon the petitioner had appeared and prayed for time and exemption of his personal appearance and participated in the proceeding through his authorized person who had been interrogated and his interrogatory statement is available at Annexure-N of the counter affidavit. The said authorized person could not give any satisfactory reply at all and thereafter when he was W.P(Crl.) No. 03 of 2012 Page 32 of 40 32 categorically asked whether the petitioner had carried the codeine based cough syrup like Phensedyl/Recodex/Silenser, he expressed his lack of knowledge, inconsistent to the seizure list at Annexure-A of the counter affidavit and the statements made by the driver and the assistant of the vehicle. [36] Mr. P. Datta, learned standing counsel has also submitted sealed cover containing secret information in writing which was received by the Superintendent, DPF, Custom Division, Agartala Tripura from one Navin Chouddhury, Inspector(G), Border Security Force and wherefrom it appears that the information regarding the carriage of drugs containing codeine for illegal export to Bengladesh was received. He has further clarified that except the formulation containing codeine were seized for the reasons that those were used for concealment of the packages of the formulation containing codeine and such the seizure cannot be questioned. By virtue of the notification dated 03.08.1974, Mr. Datta, learned standing counsel for Custom and Central Excise has emphatically submitted that the Officers from the level of the Sub-Inspector have been designated as the Proper Officer. While contending so he stated that the notification dated 08.04.2008 is a composite notification not in suppression of the other notification. But the provisions of the said notification dated 08.04.2008 issued by the Commissioner of Customs (Preventive) North Eastern Region as annexed to the re-joinder filed by the petitioner are not all exhaustive. The provisions of the said notification have been criminally breached by the petitioner. He strongly refuted the submissions of Mr. B. N. Majumder, learned counsel by stating that to derive benefit out of the said notification and to show the person, who have been W.P(Crl.) No. 03 of 2012 Page 33 of 40 33 designated as Proper Officer have so designated in reference to the respective provisions against which the referred officer of the customs has been designated as the Proper Officer whereas by dint of the other notification the other category of the officers of the customs has been designated as the Proper Officer. He further submitted that the respondent No. 4 is a Proper Officer and there cannot be any ambiguity or doubt in that matter and he is well entitled to take assistance of the officers catalogued in Section 151 of the Customs Act, 1962 or to work in tandem with those officers for purpose of prevention and detection of the offences. Thereafter, Mr. Datta, learned standing counsel while responding to the submission of Mr. B. N. Majumder, learned counsel appearing for the petitioner on whether there was any material or existence of circumstances to demonstrate that there was reasons to believe of illegal export or for search leading to the seizure as occurred in the case has referred a few judicial interdicts. [37] In Indru Ramchand Bharvani Vrs. Union of India, reported in 1992(59) E.L.T. 201 (S.C) the Apex Court has enunciated the law in no uncertain terms as under: “16. The reasonable belief as to smuggled goods, as enjoined in the Act, had been explained by this Court in State of Gujarat v. Mohonlal Jitamalji Porwal and Anr., : 1987CriLJ1061 . There this Court observed whether or not the officer concerned had seized the article under the \"reasonable belief\" that the goods were smuggled goods, is not a question on which the Court can sit on appeal. The circumstances under which the officer concerned entertains reasonable belief, have to be judged from his experienced eye who is well equipped to interpret the suspicious circumstances and to form a reasonable belief. See also M.A. Rasheed and Ors. v. State of Kerala, : [1975]2SCR93 and The Barium Chemicals Ltd. Anr. v. The Company Law Board and Ors., [1966] Su. SCR 311. It must be reiterated that the conclusions arrived at by the fact-finding bodies, the Tribunal or the statutory authorities, on the facts, found that cumulative effect or preponderance of evidence W.P(Crl.) No. 03 of 2012 Page 34 of 40 34 cannot be interfered with where the fact-finding body or authority has acted reasonably upon the view which can be taken by any reasonable man, Courts will be reluctant to interfere in such a situation. Where, however, the conclusions of the fact-finding authority are based on no evidence then the question of law arises and that may be looked into by the Courts but in the instant case the facts are entirely different. See the principles enunciated by this Court in Mehta Parikh and Co. v. C.I.T., Bombay, [1956] SCR 626. The same view was expressed by this Court in Pukhraj v. D.R. Kohli, [1962] Su. 3 SCR 866 where while dealing with the provisions of the Customs Act, 1878, this Court held that Section 178 of the said Act imposed the onus of proof that the gold was not smuggled, on the party if it was seized under the Act. The question whether it was under the reasonable belief or not, was a justiciable one. The facts of this case certainly warrant the formation of belief. In any case, once it is held that there was material relevant and germane, the sufficiency of the material is not open to judicial review.” [38] Mr. Datta, learned standing counsel has referred another decision of the Apex Court in Union of India Vrs. Lexus Exports Pvt. Ltd., reported in 1994 (71) E.L.T. 348 (S.C) where the Apex Court held that : “3. This submission looks attractive on the face of it but on closer scrutiny it is not as sound as it is attractive. The proceedings of seizure and confiscation are proceedings in rem. Until the culmination of the adjudication it is difficult to envisage any right on the part of the respondents from whom they are seized to export them on the basis of a future title they expect to acquire by payment of fine. Learned Counsel, however, says that it would earn foreign exchange for the country. But sanctity of legal proceedings cannot be whittled down on grounds of such expediency.” [39] In Tirupati Trading Corporation Vrs. Collector of Customs, reported in 1998 (104) E.L.T. 618 (Cal.), the Calcutta High Court has observed that: “7. The writ petitioner has challenged the legality of the seizures made on 3.3.1994. 10.3.1994 and 7.4.1994 by the Customs authorities on the ground that there was not material before the proper officer W.P(Crl.) No. 03 of 2012 Page 35 of 40 35 on the basis of which he could have a reason to believe that the goods which have been seized are liable to confiscation under the Customs Act. 1962 therefore, the proper officer had no jurisdiction, authority or power to seize the goods of the petitioner. 8. It appears that on- (a) 3.3.94, 200 gunny bags containing sandalwood pieces had been seized from inside the container No. NSAU-201290-1(20') at 6. K.P.D. (b) 3.3.94. 190 bags dust material and 50 bags sandalwood pieces had been seized from inside the container No. MISU- 909625-9(20) at 6. K.P.D. (c) 10.3.94. 100 bags sandalwood pieces and 50 bags dust material had been seized from the office of the Commissioner of Commercial Taxes. West Bengal at 14. Beliaghata Road, Calcutta-700 015. (d) 7.4.94, 190 bags sandalwood pieces had been seized from inside the godown of M/s. Macncil Barry Kilburn. Ex-employees Transport Co-opt. Society Ltd. at 26/1. Satya Doctor Road, Calcutta-700 023. 9. It is now well-settled law that though the question whether the seizure under section 110 of the Customs Act. 1962 was under a reasonable belief or not is a justice able one, but once it is held that there was material, relevant and germane, the sufficiency of the material is not open to judicial review. The circumstances under which the officer concerned entertained reasonable belief have to be judged from his experienced eye who is well-equipped to interpret the suspicious circumstances and to form a reasonable belief. (Indru Ram Chand Bharvani v. Union of India : 1992(59)ELT201(SC) ; Stale of Gujarat v. Mohan Lal. : 1987CriLJ1061 . In Union of India v. Lexus Exports Pvt. Ltd. reported in : 1994(71)ELT348(SC) . It was held by Supreme Court that the proceedings of seizure and confiscation are proceedings in rem.” [40] Mr. Datta, learned standing counsel, Custom and Central Excise has placed reliance on State of Gujarat Vrs. Shri Mohanlal Jitamalji Porwal and another, reported in 1987 (29) E.L.T 438 (SC) where the Apex Court held that: W.P(Crl.) No. 03 of 2012 Page 36 of 40 36 “5. ****** Whether or not the official concerned had seized the article in the \"reasonable belief that the goods were smuggled goods is not a question on which the Court can sit in appeal. The law to this effect has been declared in no ambiguous terms in Pukhran v. D.R. Kholi : 1983(13)ELT1360(SC) . This Court has administered caution to the Courts not to sit in appeal in regard to this question and has observed that if prima facie there are grounds to justify the belief the Courts have to accept the officer's belief regardless of the fact whether the court of its own might or might not have entertained the same belief. The law declared by this Court is binding to the High Court and it was not open to the High Court to do exactly what it was cautioned against by this Court. Section 123 of the Act does not admit of any other construction. Whether or not the officer concerned had entertained reasonable belief under the circumstances is not a matter which can be placed under legal microscope, with an over- indulgent eye which sees no evil anywhere within the range of its eyesight. The circumstances have to be viewed from the experienced eye of the officer who is well equipped to interpret the suspicious circumstances and to form a reasonable belief in the light of the said circumstances. In the present case the concerned official had mentioned three circumstances which made him entertain the reasonable belief that the article was a smuggled one viz:” [41] Mr. Dutta, learned standing counsel has further submitted that the community acting through the State is also entitled to justice. The cause of the community deserves equal treatment at the hands of the Court in the discharge of its judicial functions. The community of the State is not a persona-non-grata whose cause may be treated with disdain. The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to books. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the Community. Therefore, he has contended that at this stage the technicalities should not defeat the purpose W.P(Crl.) No. 03 of 2012 Page 37 of 40 37 of inquiry and investigation. The writ petition has been filed to frustrate the investigation as has been carried out in accordance with law. [42] Mr. Datta, learned standing counsel, before his reliance of some other decisions of the Apex Court on the aspects of illegal exports via the routes as not declared under Section 7 of the Customs Act, 1962 has contended that the petitioner has got antecedent to such criminal aberrations and abetment as recorded in the records as produced along with counter affidavit. Another seizure memo dated 17.11.2012 in respect of the petitioner is available at Annexure-A/2 to the petition. On such basis, Mr. Datta, learned standing counsel Customs and Central Excise contends that the petitioner turns out to a habitual offender and he cannot expect any leniency in such heinous transaction under scrutiny. Mr. Datta, learned standing counsel has also categorically stated that before passing of the adjudication order adequate opportunity in terms of the law was afforded to the petitioner and in response thereto he appeared and made the statement. On scrutiny of all materials the appropriate authority passed the adjudication order dated 31.03.2011 in respect of the said seizure case. Thereafter, Mr. Datta, learned standing counsel Customs and Central Excise has placed reliance on State of Maharastra Vrs. Natwarlal Damodardas Soni, reported in AIR 1980 SC 593 where the Apex Court held that: “**** It may be observed that the police had powers under the Code of Criminal Procedure to search and seize this gold if they had reason to believe that a cognizable offence has been committed in respect of thereof. Assuming arguendo, that the search was illegal, then also, it will not affect the validity of the seizure and further investigation by the Customs Authorities or the validity of the trial which followed on the complaint of the Assistant Collector of Customs.” W.P(Crl.) No. 03 of 2012 Page 38 of 40 38 [43] In Assistant Collector of Central Excise, Rajamundry Vrs. Duncan Agro industries Ltd. and Others, reported in AIR 2000 SC 2901 the Apex Court held that: “*****The inculpatory statement made by any person under S. 108 is to non-police personnel and hence it has no tinge of in admissibility in evidence if it was made when the person concerned was not then in police custody. Nonetheless the caution contained in law is that such a statement should be scrutinized by the Court in the same manner as confession made by an accused person to any non- police personnel. The Court has to be satisfied in such cases, that any inculpatory statement made by an accused person to a Gazetted Officer must also pass the tests prescribed in S. 24 of the Evidence Act. *****” After a discussions in Duncan Agro industries Ltd.(supra) the Apex Court has culled out the law in respect of the inculpatory statements made to the custom officers in the following passages: “16. It is unfortunate that the Division Bench of the Andhra Pradesh High Court has not addressed itself of the above well settled legal position when learned Judges of the Bench (Ramanujula Naidu and Panduranga Rao, JJ) held that the statement recorded under Section 108 of the Customs Act without complying with Section 164 of the Code \"will be inadmissible in evidence for any purpose.\" 17. We hold that a statement recorded by customs officers under Section 108 of the Customs Act is admissible in evidence. The court has to test whether the inculpating portions were made voluntarily or whether it is vitiated on account of any of the premises envisaged in Section 24 of the Evidence Act. Such an exercise can be made only after the appeal is regularised by granting leave to appeal. Since leave was declined on a wrong interpretation of law we have to interfere with the impugned order.” [44] By dint of the said enunciation, Mr. Datta, learned standing counsel has emphatically contended that the prima facie such from the voluntary statements made by the witnesses and the material so seized it is unequivocally demonstrated that for illegal export the seized goods, the W.P(Crl.) No. 03 of 2012 Page 39 of 40 39 restrictive items for surveillance of the Customs authority, were carried to the specified area. Therefore, the contention of the petitioner is absolutely without any basis. The search, seizure and the subsequent proceeding have been carried out strictly in accordance with law and by the appropriate officers. From the adjudication order dated 31.03.2012 it would also be apparently clear that nobody has claimed the ownership of the seized materials despite the notice being served on the basis of the manifest, available with the vehicle which carried the seized materials. [45] On appreciation of the contentions and the materials as laid before this Court, this Court finds that the Seizing Official was the Proper Officer for purpose of conducting the search and seizure and apparently search and seizure did not suffer from any irregularity or fatal breach of any provision which might turn those into an illegal procedure. Apart that, from a close scrutiny of the confidential and secret information as made available by the Superintendent DPF, Customs Preventive Division it appears that information which was received is adequate and sufficient enough to form someone to reasonably believe that some materials under the list for surveillance were being carried to that place for purpose of illegal export to Bangalesh. Therefore, the challenge regarding the non-existence or lack of materials and circumstances for reasons to believe cannot be sustained. Moreover, what has been found in addition thereto is that the petitioner has already participated in the proceeding drawn under Section 108 of the Customs Act immediately after the seizure through his authorized person and thereafter the appropriate order has been passed by the competent authority, which is the adjudication order dated 31.03.2011 in Seizure Case No. W.P(Crl.) No. 03 of 2012 Page 40 of 40 40 13/CL/EXP/CUS/HQRS.PREV/SH/09-10 as stated. This Court has been reminded of the Apex Court’s observation that even if there is some irregularities in the search, the seizure would not be automatically illegal. Therefore, this Court does not find any reason to interfere with the action of the respondents as impugned in this writ petition or to prohibit the respondents for acting in furtherance of the Seizure Case No. 33/CL/EXP/DPF/AAGT/12 or to direct release of the seized goods. [46] The writ petition, therefore, stands dismissed. However, there shall be no order as to costs. [47] The sealed cover contains the secret information as produced before this Court was broken open for examination and is returned in the sealed cover along with the letter, copy of which has been made available in the counter affidavit at Annexure-A/1. JUDGE d.de. "
Other Referred Cases
Sri Sai Trading Company & Anr. Vrs. The Union of India & ors, Indian Nut Products and others vs. Union of India and others, Whirlpool Corporation Vrs. Registrar of Trade Marks, Mumbai and Others, Jaipur Development Authority Vrs. Ram Sahai & Anr., Union of India Vrs. Abdul Mohamed, Union of India Vrs. Lexus Exports Pvt. Ltd., Tirupati Trading Corporation Vrs. Collector of Customs, State of Gujarat Vrs. Mohanlal Jitamalji Porwal and Anr.
Laws Referred To
Customs Act, 1962, Value Added Tax Act, Foreign Trade (Development & Regulation) Act, 1992
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